'Tis the Season to Spend Money

Some retailers will tell you the state's new sales tax holiday, patterned on similar promotions in New York and Florida, is a pain in the caboose. They have to reprogram cash registers, train staff and make other changes so that their customers can buy clothing under $100 and get a waiver on sales taxes for one weekend.

Others will tell you this is a wonderful deal that gets people into the stores and boosts sales and makes the retailers richer and the politicians happier. They do expect more traffic; the question is whether that means less traffic on other days to compensate. There's some argument over whether sales simply change dates or actually rise, but big retailers say there's a small rise in overall sales. Some few of them even wanted to extend the sale for a week, but the law says they can only let customers duck sales taxes for 72 hours.

As you read this, the state is going through its first experience with sales tax holidays, and from the state's viewpoint, this gives up tax revenue of $69.2 million. It'll cost cities, counties and other local entities about $15.5 million. This is the first of three such back-to-school extravaganzas; similar August sales will take place for the next two years.

The law creating the sales tax holiday contains something that sounds a lot like a trap, but that won't prevent anyone from stepping it in. To wit: Local governments are required to play along this time, giving up their revenue at the same time the state does. But in the future, they'll be able -- if they dare -- to keep their taxes in place while the state tax is suspended. In most cities, that would mean that consumers would get a tax reduction instead of a holiday. Instead of 8.25 percent tax, they'd pay two percent. Most city hall types won't fall for that, but they'll get the opportunity this time next year.

The sales tax trick put a lot of political planes in the air, if nothing else. Lt. Gov. Rick Perry and various senators and others tooled around the state for a series of press conferences touting the sale. And Comptroller Carole Keeton Rylander did the same, but on a more limited basis (she's still recovering from knee surgery).

And After the Sale, We Can Shorten the School Year

That's not the only instance of moving things around to try to drum up new business. There will be an effort by a new coalition during the next legislative session to change the dates that Texas public schools are open for business. Who cares? Well, summer businesses care: Folks who own amusement parks, water parks, businesses dependent on people at the beach.

One argument for changing the dates is that it will generate more business. That view hasn't prevailed in the past. The comptroller's office, which estimates the impact such moves might have on sales taxes, has always said that changing the school year simply moves business from one day to another one. This newest proposal might, however, affect business and government revenues.

Proponents want to cut the number of non-teaching days in the school year, so students will be free for a longer time during the summer. That would have at least two benefits to the businesses that thrive during the summer. First, their customers would have more time to play. Second, their workforce -- often made up of high school and college students -- would be available for a longer period. The new pitch will be that the school year is long because of in-service days and downtime, and that those holidays during the school year cut into the longer summer holidays of yore. In short, they'd like to return to the days of September to May school years.

Go Forth and Consult No More

Canton-based Winning Strategies, Inc. is getting out of the political consulting business. But talk about burying the news: That little tidbit emanates from somewhere way down the page in a press release wherein the company says it will concentrate on market research, polling and call center businesses. It then says the company will get out of "less profitable areas like printing, graphic design, some data management, and political consulting.

The company, run by Bob Reese, will fire 15 to 20 people as a result. They'll still sell services to political consultants, but the company itself won't be in the consulting game.

The company apparently ran into a problem with its business model: It could make lots of money on the candidates it was consulting, since it could provide turnkey service to them. But other consultants -- both political and corporate -- wouldn't hire them because of the conflicts of being in the same business. For some clients, it was a question of hiring the company to handle everything, or to handle nothing. Reese says he's staying with what was making money and leaving the rest behind.

Rattle it around, and it means Winning Strategies will be in a support role for some kinds of political work, but will close its Austin office, and will set free its consultants -- notably longtime GOP operatives Royal Masset and Jeff Fisher -- to do business on their own. The company had several candidate signings in the pipeline, but only Tom Greenwell, who is running for the Texas Court of Criminal Appeals, had actually signed on. Those clients will apparently stay with Masset and Fisher.

Reese ran against Sen. David Cain, D-Dallas, but hasn't said whether he'll repeat that run. Earlier this year, Reese's supporters were expecting him to launch a rematch; instead, he said he was "leaving the door open" but had nothing to announce. That's still the song: Don't count him in, don't count him out. In the meantime, no Republicans have jumped into the race with Cain.

Working on the Railroad

Sen. Tom Haywood, R-Wichita Falls, is nosing around to see if anyone would support him in a bid for Texas Railroad Commission should he decide to take on Michael Williams, an appointee and personal friend of George W. Bush who is up for election next year.

One argument for Haywood to make that race is that he has been involved for years in oil and gas and knows the people and the issues, while Williams is new to the game. Some of his political allies say he looked at the commission before he ever ran for Senate, and is still interested in the agency. Haywood, who's not up for reelection this year, would also have a free shot at the race and could return to the Senate in the event of a loss.

The arguments against? Williams and Bush go way, way back. Bush was the campaign manager for Williams' first attempt to win an election. Running against Williams, in short, could be taken as an affront to the governor. Additionally, Williams, who is black, gives the GOP ballot some needed diversity. Haywood, who is white, doesn't.

Haywood hasn't announced anything, but has shopped around for support. Williams is definitely in the race: He has already staffed his campaign office and is raising money. Many in the GOP expected him to sail through next spring's primaries without opposition, which is still possible.

So why is this happening? One speculation about the Haywood moves is that the senator, who suffers from Parkinson's Disease, is taking the opportunity to dispel persistent rumors that he won't finish his current term. If he's looking at this, the line goes, he must feel fine.

Another theory: It distracts people from steady rumblings that Charles Matthews, one of the state's two other railroad commissioners, will certainly draw a Republican opponent. No such thing has happened, but we're still in the tire-kicking season. Matthews plans to zip around the state later this month announcing officially that he's a candidate for reelection.

Dragging the Sack

For a while there, the CD 7 race to replace U.S. Rep. Bill Archer, R-Houston, was the busiest booth at the carnival, with a half-dozen Republican candidates clawing at each other for attention.

And now, the logical next thing -- that would be money -- is proving to be just as big a deal. The results are incomplete, because not all of the candidates filed electronic reports and so not all of the reports are available to non-Washingtonians.

That said, two candidates in the race, Mark Brewer and Peter Wareing, each report having well over $600,000 in the bank. Both show up on national rankings of the most well-funded campaigns in the country, based on the most recent reports with the Federal Election Commission. It's true that there are loans involved in those totals, but the totals foreshadow a very expensive primary ahead. Brewer ranked fifth among U.S. House candidates for self-loans during the first half of the year; he loaned himself $559,846. Wareing loaned his campaign $25,000.

It's possible there won't be much spending at all after the primary. There are no Democrats in the race, and there might never be, since Archer's is one of the most solidly Republican districts in the U.S.

• We said a while back that Tom Reiser, a GOP who's challenging U.S. Rep. Ken Bentsen, D-Houston, in CD 25, hoped to raise $300,000 or so during the first half of the year, leaving about $210,000 in the bank. Yes, he did, but it took a loan from the candidate of $176,870 to make it to the goal. To run against Bentsen, Reiser has to win his primary, where he'll face Robert Sharpe.

• Regina Montoya Coggins says she raised $128,550 for her CD 5 challenge to U.S. Rep. Pete Sessions, R-Dallas, and ended the reporting period with about that much money on hand. Coggins, a Democrat, will probably face a primary opponent, Gary Harrison, in March. He raised about $30,000 including an $11,000 loan, and has less than $4,000 on hand. Mark Harkrider, a Democrat who was planning to make the race, has decided not to move forward, thinning the field.

These Guys Were Noisy Last Time, Too

• Another challenger, Loy Sneary of Bay City, says he has pulled in $186,405 for his rematch in CD 14 against U.S. Rep. Ron Paul, R-Surfside. Sneary, who lost to Paul in last year's elections, says he got to mid-year with $171,250 on hand. According to FEC records, that includes $60,000 in loans from the candidate himself; his supporters hope the total will be daunting to potential challengers in the Democratic primary. Paul raised $218,308 and ended up with $188,545 in the bank.

Sneary and Paul mixed it up a little bit over the finance reports. Sneary put out word about how much he had raised. In time-honored tradition, he failed to mention that he had loaned his campaign any money. Paul jumped on that, adding the claim that Sneary's campaign debts total $91,000.

That merited a counter-snap of the towel from Sneary, who responded with his own news release calling all of this proof that Paul is worried. Here's the nub of it, and you'll hear more along these lines: Paul shoots at Sneary for taking money from political action committees; Sneary shoots at Paul for raising most of his money outside of the state. Paul says he didn't take PAC money during this period; Sneary says Paul has raised money from PACs in the past.

• Winner, for the moment, of the Ton of Money in the Bank Award -- Texas Division, is U.S. Rep. Lloyd Doggett, D-Austin. He's sitting on a $1.4 million bank account, though no one has announced a challenge to him. Unopposed Rep. Joe Barton, R-Ennis, is the runner-up, with $880,974 on hand.

• While most of us were lurking in the Pink Building and watching the Legislature do its magic, the Texas GOP was busy raising money. They reported raising $1.9 million during the first six months of the year through their state and federal committees. Democrats, counting those same committees, say they raised $585,536 during the first six months of the year. And here's an odd little side note: After all the noise made on both sides on the need for campaign finance reform, which of the two parties filed its finance report electronically? Neither one. You have to go to the Ethics commission offices in Austin to see what's going on with their state reports.

The Ripple is Bigger Than the Rock

Comptroller Carole Keeton Rylander fired thirteen folks last week and the tom-toms were going for days. Odd, with such a relatively small layoff, but there it is.

Part of the reason is that aides said the firings were the result of merging two divisions and that there's more where that came from. The official line is that the agency is being reworked one division at a time, and on no particular timetable. That means, for instance, that the agency isn't racing the clock to get all this done by the end of the fiscal year next month. Also, Rylander's assistants say the people laid off in one round are eligible to be rehired in another round, if hiring is called for.

While Rylander was at it, she demoted a handful of people, including a couple that came to the agency with her at the beginning of the year.

While we're talking reorganization, remember that Attorney General John Cornyn said when he took office that he would wait several months, get his sea legs, and then make some decisions and some announcements about hirings, firings, reorganizations and whatever.

That's coming within the next few weeks, though there's not a firm date. And while there might be some pink slips, there will probably be fewer than there would have been if this had taken place in January: Several dozen people left the agency on their own. Whatever gets announced at the AG's office, we are told it won't involve the child support division. That division, which is itself bigger than most state agencies, is being treated as a separate can of worms.

Waiting for Drew to Drop the Other Shoe

The politicos in SD 3 must have meant late August when they said they'd reveal their plans this month. Sen. Drew Nixon, R-Carthage, has not yet said whether he'll run for reelection. Besides that, when we called for an update, he was taking some time off someplace where phones and pagers don't work. He'll make an announcement within the next few weeks. We're not making this up to hedge our bet, but some of his friends say he'll run, some say he'll quit, some say he hasn't decided.

As for the rest of the scorecard, there is still no final decision from Reps. Clyde Alexander, D-Athens, and Todd Staples, R-Palestine. Both have said they were thinking about it. Rep. Jim McReynolds, D-Lufkin, got his name stuck in the rumor mill, but says he's only about 20 percent interested. No sale there. Bob Reeves of Center, a Republican, has hired consultants and is ready to go. And Democrat David Fisher of Silsbee is in, running, and has letterhead and all that to prove it.

ELSEWHERE: He doesn't know where those pesky rumors are coming from, but Rep. Joe Crabb, R-Atascocita, says he will be running for reelection. There has been some talk in his district that Crabb, first elected to the House in 1993, wanted out of the game. He doesn't. He'll be on the ballot in March. He might not be alone on that ballot, however. Michael Sullivan of Kingwood, one of Crabb's constituents, is talking to potential supporters about a challenge.

Car Dealers and the Lesser of Two Evils

During the legislative session, we told you about Ford Motor Co's. attempt to change Texas law to allow carmakers to own dealerships on a long-term basis. They can own them now for short periods, such as when they take over bankrupt operations, but they can't remain for a long period of time in the retail business in Texas. Ford wanted to form a cluster of dealerships from car sellers the company had taken over in Fort Worth.

But Ford's changes didn't go through. Texas car dealers, who were decidedly not fond of the idea, actually got the law toughened a bit. The dealers didn't want automakers poaching on their businesses and potentially undercutting their prices.

Now that it's been kicked out of the retail business in Texas, the company says it will sell the Fort Worth dealerships to AutoNation Inc., a Florida-based chain that owns more than 400 dealerships around the U.S. Texas dealers aren't too happy about that, either, but it's allowed. They're not wild about the new entrant's market power, but they do say they prefer it to a manufacturer.

Toward the Head of the Class

Teachers in Texas will get the $3,000 pay raises the Legislature promised, but their average pay hikes will be even higher than that because of local raises that were already on the way. The Legislature told districts that the state money should be added to whatever the teachers were going to get before the state put money in. According to the Texas State Teachers Association, that means the average teacher in the state will get $3,816 more this year. That group says average pay for Texas teachers will climb to $38,857 from $35,041 last year.

TSTA says that still leaves Texas educators about $2,800 below the national average. By their numbers, the state's teachers ranked 33rd in the nation last year. This year's rankings aren't known, since the numbers from other states haven't been compiled.

By another estimate, it would have taken a pay raise of $6,000 per year to get Texas teachers to the national average pay for teachers, and that's why at least some of the teacher groups began the last legislative session by pushing that number. They got $3,000, which ain't hay, especially coming from a state that hasn't made teacher pay a priority in recent years.

Now the American Federation of Teachers, which authored the original study that produced the $6,000 per year figure, has a new survey out. As you would expect, it says that average teacher pay in Texas will still be below the national average.

The state ranked 36th last year, and would rank 26th with the pay raise if no other states raised pay at the same time. That's a decided improvement, but Texas teachers can still support the argument that they are paid less than their peers who teach elsewhere.

The new survey also says that the pay raise put new Texas teachers way ahead of the pack. The survey covers the last school year, so we're comparing next year's teacher pay in Texas with what everybody else made last year. That said, the raise would push new Texas teachers into the top ten states in the country. Last year they ranked 25th among new teachers in all states.

The betting here is that this signals a shift in the argument, from this year's "Pay teachers in Texas at least the national average" to "Raise pay for experienced teachers so they won't leave." The numbers make it possible to argue that the state starts off alright in terms of teacher pay, then lets educators slowly slide behind their peers' pay as they get more experienced.

Another angle on this argument comes from Sen. Teel Bivins, R-Amarillo, the Senate's Education Committee chairman, and others, who point out that the costs of living in at least some parts of Texas are below the national average. Though we're not aware of any studies or surveys that adjust national salary disparities to account for local costs of living, their argument is that lower salaries here sometimes contain more real buying power than higher salaries elsewhere.

Random Business Notes

The Texas Association of Business and Chambers of Commerce is looking at a rating system that would allow the trade group to look systematically at lawmakers' voting records. That, in turn, could feed the group's campaign finance and endorsement decisions. TABCC is talking to a North Carolina group that's done work in this area. The trade group watches votes now, but wants to put a more sophisticated system in place... Deaths on the job were up in Texas last year. A total of 523 people died on the job in Texas during 1998, up from 459 in 1997. Car and truck accidents accounted for 41 percent of the fatalities, and assaults and violent acts accounted for 79 deaths, up 25 percent from the previous year, according to the Texas Workers Compensation Commission. Another 74 of the deaths were caused by "exposure to harmful substances or environments"; 42 of those were from electrocution. The chances of dying on the job, even with the higher numbers last year, remained fairly constant. One other thing: the 1998 numbers were higher than the 1997 numbers, but not far off the 1996 total of 514 workplace deaths. Over the last seven years, the number of fatal injuries at work has gone as low as 459 (in 1997) and as high as 536 (in 1992). Based on the latest numbers, the agency says it will focus its efforts on transportation and construction safety programs.

Political People and Their Moves

Matthew Dowd, who left Austin-based Public Strategies, Inc., earlier this year, has signed on with Maverick Media. That's the firm set up by Mark McKinnon, another alum of PSI, to handle advertising and research and such things for Gov. George W. Bush. Both Dowd and McKinnon were Democratic campaign veterans before they joined PSI... Ward Tisdale is moving out of the government and government relations game. Tisdale, who worked in the press office for former Attorney General Dan Morales and then did a stint with the Texas Association of Health Plans, is off to work for AMD, the chip manufacturer... Brian Sledge is leaving the Texas Water Development Board, where he has been director of research for a couple of years, to join Lloyd, Gosselink, an Austin-based law firm that specializes in environmental issues. Sledge, former clerk on the House Natural Resources Committee, will do some lobbying and some regulatory work, primarily dealing with water issues... Bill Scott, chief of staff to Sen. Troy Fraser, R-Horseshoe Bay, is jumping out of government and back into direct politics. He'll open an Austin office this fall for the Dallas-based Clements Group, a political consulting outfit. Scott was a reporter (Dallas Times Herald, Fort Worth Star-Telegram) and aide to various GOP officeholders before joining Fraser... Another departure from that same office: Lisa Valenzuela is on her way into the political world to manage the reelection campaign for Texas Supreme Court Justice Nathan Hecht... Appointments: Judy Walsh's term as a public utility commissioner is over at the end of the month, and Bush can reappoint her or go with someone new. The current lobby betting line is that he'll stay with Walsh, but no announcement has been made. Bush tapped Laura Lee Parker of San Antonio to be the first judge of the new 386th Judicial District Court. That's a juvenile court created during the legislative session. Parker is an assistant district attorney in Bexar County. Also in San Antonio, also a new court and a new appointment: Bush named Robert "Bert" Richardson, an assistant U.S. attorney, as judge of the new 379th Judicial District Court.

Quotes of the Week

Former White House aide (and Texas political consultant) and current college professor and pundit Paul Begala, on the political distance between Gov. George W. Bush and congressional Republicans: "Bush is running from the House Republicans like the devil runs from holy water. And in my view the Democrats shouldn't let him."

Tony Coelho, campaign chairman for Vice President Al Gore, reacting to Begala's advice: "He has a right to his views. He's with MSNBC."

Bush aide Karen Hughes, trying her darndest to cut into the expectations game in Iowa, where everyone else has campaigned longer and where her boss is nevertheless the man to beat: "We recognize that we are behind, that we have a lot of work to do, and we're working very hard."

U.S. Sen. Phil Gramm, R-Texas, on emergency farm aid proposals from the Republicans and the Democrats: "We're competing to show our compassion. It's a political bidding contest here. You're seeing figures made up on both sides of the aisle."

George Washington University professor Michael Cornfield, on the relative lack of success of early efforts to raise political money through email appeals: "No one's cutting-edge yet. Nobody's taking any risks yet. You know what I'm waiting for? Online auctions for candidates."

Fort Worth mortician Dick McNeil, who chairs the Texas Funeral Service Commission, on criticism of that agency: "We get a very small staff that is very underpaid and they expect us to inspect every funeral home in the state once a year. This is a big old state, and with what they give us to work with, we're going to get behind."

Consumer researcher Harry Balzer of NPD Research, on what has happened to the two-day weekend: "Saturday is still a workday. It's just a different kind of work."

Mary Hallen Fiorito, vice chancellor for the Archdiocese of Chicago, on parishioners who take food to church for themselves and their children: "When you're trying to reach a state of spiritual contemplation, there is nothing like sitting on a bag of Cheerios to throw you off."

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Texas Weekly: Volume 16, Issue 6, 9 August 1999. Copyright 1999 by Printing Production Systems, Inc. All Rights Reserved. Reproduction in whole or in part without written permission from the publisher is prohibited.